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YOUR GO-TO SOURCE FOR ANALYSIS OF ISSUES AFFECTING THE PHARMA & BIOTECH SECTORS

The US Court of Appeals for the Federal Circuit’s February 10 decision in Acetris Health, LLC v. United States provides important guidance regarding the determination of a product’s country of origin, which is a gating issue for prescription drug products the US government is permitted to buy.

As companies that have or intend to commercialize products, including drugs and biologics, for sale to the US government are aware, the Trade Agreements Act (TAA) generally prohibits government purchases of certain foreign products. The Trade Agreements clause and related Trade Agreements certification, which are prescribed by regulation, are the principal clauses in government contracts—such as the VA Federal Supply Schedule (FSS) contract from which all government agencies purchase drugs—that effectuate this requirement. The clauses require companies to certify that products delivered under the government contract will be either manufactured in the United States or “substantially transformed” in the United States or a designated country, e.g., countries with which the United States has entered into trade agreements.